Thursday, July 5, 2012

The President’s Proposal to Revive the Economy

The President proposes to borrow more money or raise taxes to hire hundreds of thousands of police and firefighters as a way to revive the stalled economy. Such a proposal reveals a catastrophic lack to economic understanding, both by him and his supporters.  Public Sector jobs don’t count !

It’s not hard to understand why he and his supporters have proposed this. They see a healthy public sector when the economy is strong.  But they mistakenly think that if they pump money into the public sector, the economy will return to prosperity. But it’s putting the cart before the horse!

A healthy PRIVATE SECTOR economy generates the healthy tax revenues to support the Public Sector: not vice versa. To pump money into hiring police and firefighters means draining even more resources out of the more productive private sector that would actually lead to a contraction of the private sector, not its expansion.

It’s not that Republicans “hate police and firemen” as the Democrats will assert when we opposed the President’s proposal . It’s because the President’s proposal is ABSOLUTELY THE WRONG THING TO DO! If the President prevails, the economy WILL NOT REVIVE!

The right thing to do is allow entrepreneurs and private sector business people keep more of their own money to build their businesses! This is what generates a self sustaining demand for goods and services, and real jobs as people are hired to “help out” with the growing business activities.

Government jobs, on the other hand, can only be sustained by a continual hemorrhage of resources from a weakened private sector.

   Sadly, allowing people to keep more of their own money to build their businesses is thought of by the Public Sector Marxist-Leninist Progressives as “giving tax breaks to the fat cats!” This means there will be no recovery unless there is a change in management in Washington DC.

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